AC 478
Spring 2008
Instructor: Wells
Review Topics for Test No. 1
Review Topics for Test No. 1
DISCLAIMER
: The below items are not all inclusive. These are some major points for you to review. Please do not rely entirely on this information to prepare for the test.
1. Outside assignment re Code of Ethics and State Board of Public Accountancy’s Rules & Regs – Chapter 6 Code of Professional Conduct
2. Outside assignment – interview a CPA
3. Chapter 1 Material
a. Definition of Auditing
b. Differs from accounting
c. Information risk and relationship to auditing
d. Assurance services – different levels
e. Types of audits
f. Requirements to become a CPA
g. The 4 parts of the CPA exam
4. Chapter 2 Material
a.10 Generally Accepted Auditing Standards
b. Elements of quality control (Table 2-4 in 11th edition)
c. State Board of Public Accountancy vs. AICPA, vs. PCAOB
d. Sarbanes-Oxley and the Public Companies Accounting Oversight Board
e. GAAS vs GAAP (question 2-8)
5. Chapter 3 Material
a. The Standard Unqualified Audit Report p. 46 etc in 11th ed. Figure 3-1
b. Types of audit reports
c. 5 conditions before an unqualified opinion can be given
d. Subsequent events
6. Chapter 4 Material
a. Restrictions under Sarbanes-Oxley (PCAOB) regarding services provided by auditor
b. Audit committee’s role
c. State Board vs. PCAOB vs AICPA
7. Chapter 5 material
a. Various cases – Ultramares, Hochfelder, Bar Chris, 1136 Tenants, Andersen
b. Prudent person concept
c. 4 sources of legal liability for auditors
d. Business failure, audit failure, audit risk
e. Steps taken by profession re reducing risk of liability
f. Steps to be taken by individual CPA to reduce risk of liability
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